High Court Closes Door for Class-Action Lawsuit Over Online Computer Pricing
Posted on: Friday, 13 July 2007, 12:13 CDT
OTTAWA (CP) - The Supreme Court of Canada has nixed a potential Quebec class-action lawsuit against the Dell Computer Corp. over incorrect online prices.
The court ruled 6-3 Friday to refer the case in question to arbitration, a judgment that will be seen by some as a buyer-beware defeat for consumers.
A Quebec consumer advocacy group wanted to sue the Dell computer giant after the company mistakenly posted low prices for its Axim handheld personal digital assistants.
The high court was asked to rule on clauses many businesses, such as computer-makers and cellphone companies, are invoking. They force dissatisfied customers to challenge companies through arbitration instead of the courts.
In 2003, Dell's Web site incorrectly offered the Axims for $89 and $118, depending upon the model, but the real prices were $379 and $549 respectively.
A Montreal man, Olivier Dumoulin, launched the lawsuit against Dell because the company wouldn't honour the lower price on its Canadian website. In 2004, the Quebec Superior Court granted him and a consumer group class-action certification.
Friday's ruling overturns that lower court decision.
After the case emerged, Quebec rewrote its consumer protection law, no longer permitting companies to invoke such arbitration clauses. Ontario also forbids them, but other provinces have not.
Big business tends to favour arbitration because it's done privately, it doesn't draw negative publicity and costs less.
The high court set out Friday that the ability to pursue a class-action lawsuit is a procedural right that does not automatically apply to every dispute.
Moreover, it ruled that legislation passed in Quebec preventing companies from using arbitration clauses - a bill passed after the legal case in point began - cannot be retroactively applied.
"In the case at bar, the arbitration clause was not prohibited by any provision of Quebec legislation at the time it was invoked," wrote Justice Marie Deschamps for the majority.
Source: Canadian Press
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